(As of 7:20 am PST)
US stocks are higher at the open, continuing yesterday’s
positive run which saw most broad indexes higher on the day. Today’s optimism is being fueled by rumors of
additional stimulus measures throughout Europe and Asia as well as a positive
reading on US durable goods orders.
Durable goods orders rose a stronger-than-expected 2.2% in February
receiving a positive response from markets this morning. However, digging a layer deeper sheds light on some underlying weaknesses. The rise in
orders last month was largely derived from increases in aircraft orders, a
sector that is known to be highly volatile.
Stripping out transportation, orders rose only 0.2%. Also troubling, was a decline in core capital
goods, a broad measure of business investment.
Many economists are now forecasting a drag on 2014 GDP growth if business
investment continues to be lackluster.
Markets mostly shrugged off the report embracing the hopes for an additional
round of stimulus in Europe and China.
International markets were higher on the news. Gold is flat and oil higher while interest
rates are down on the day.
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